Not much substance in the Federal Budget

NOT MUCH SUBSTANCE IN THE FEDERAL BUDGET

Well, budget night Tuesday night and I can’t see anything earth shattering, except to acknowledge the clever strategy in basically conceding something in almost every area that Labor has complained about.

Labor will find it very difficult to retain credibility if it keeps blocking every bill that comes up, providing many opportunities to give Shorten a bollocking. I guess that’s fine if it’s your game but as to substance, few will be dissecting and analysing the repercussions of this budget 10 years from now (by way of comparison see The Doomsday Book, which scholars are still poring over, 931 years after it was written!).

The issues around the cost of housing are deep seated, financial and cultural.

The tax cuts for small business don’t really exist. That’s because when Australian businesses pay tax they get franking credits, which are distributed and taxed in the same way as cash – so you pay the tax in the business, but get a credit for it when you receive a share of those profits as a dividend. For small business then, the cut in the small company tax will be of modest benefit to near-term cash flows, but of very little overall economic benefit. In essence, it’s a great headline but there is no way it’s worth all the palarva (from both sides) leading up to its adoption.